I was only $10m off the mark.
In an earlier blog I estimated, after trawling through 40 or so sets of accounts, that KiwiSaver providers had charged a collective $26m for their efforts in the 12 months to the end of March this year.
However, the true figure was closer to $36m, which bumps up the asset-based cost (based on funds under management of $2.6bn at March 31) of KiwiSaver to 1.4 per cent – still cheap maybe.
The $36m figure appears in the annual report published by the Government Actuary (GA), the body responsible for supervising the KiwiSaver providers, and should therefore be much more accurate than my attempt.
For a government agency with such a wide brief (including superannuation funds as well as KiwiSaver providers) the GA is woefully under-resourced but it does a good report: you can download both the KiwiSaver report and another publication surveying the old-style superannuation funds here.
The reports are companion pieces really and should be read in conjunction with the one (KiwiSaver) revealing an industry full of youthful exuberance and the other detailing an aging business that, while not quite dead, is looking a bit poorly.
KiwiSaver is probably sucking some of the remaining life out of the established superannuation schemes as the GA report notes: “There is substitution, but it will take a significant exercise to establish more accurately the trends without waiting for a further two years of data.”
I can’t see the GA securing further funding for this exercise.
The GA publications have not received wide coverage, drowned out by the blah surrounding the ACC report, although the financial figures at stake are similar.
Also ignored was the IRD annual report, which was published at the same time – I guess you can get report overload. After reading the IRD report I had to upgrade my cost of KiwiSaver numbers. The tax department has spent at least $40m on IT to manage the scheme and buried in there somewhere should be another figure revealing how much the IRD spends each year on the hundreds of staff who are paid to answer your irritating questions about KiwiSaver.